The deadly terrorist attack by the Islamic State in Paris on Friday, which has claimed at least 129 innocent lives, serves as a grim reminder of the kind of challenges that the world is facing today. Global leaders gathered soon after the Paris incident in Antalya, Turkey, for the G20 summit. While the G20 is a forum for enhancing economic cooperation, the Paris attack shifted the attention to issues related to terrorism and security. Leaders of the G20 were united in condemning the incident and have issued a “strong statement on the fight against terrorism".

The statement called for preventing and suppressing “terrorist acts through increased international solidarity and cooperation, in full recognition of the UN’s central role...as well as through the full implementation of the relevant international conventions, UN Security Council Resolutions and the UN Global Counter Terrorism Strategy". However, differences often emerge when it’s time for action against the perpetrators of terrorism and those who support such acts. The G20 statement does not reflect any major change in strategy to collectively deal with terrorist organizations such as the Islamic State.

In fact, Russia is unilaterally acting against the Islamic State in Syria and now claims that some countries in the G20 are funding the organization. There are vast differences among global powers on the issue of Syria and how to deal with the Islamic State. This is the reason why it has been able to gain so much ground. Also, Russia’s intervention in the region is widely seen as an attempt to help Syrian dictator Bashar al-Assad, who the western powers want to go; and they have been helping the rebel forces in the region to attain this objective. Certainly, despite renewed commitment, things are not going to be easy either in Syria or the fight against terrorism in general.

Such differences are not restricted to matters of security and are equally profound in the area of economics and finance. Essentially, what the world needs is better coordination in dealing with the emerging economic and geopolitical challenges. The joint communique at the end of the two-day G20 summit, for example, pledged to promote financial stability, clearly communicating policy action to avoid uncertainty, and resist protectionism. However, the reality is that the individual states are driven by their own policy objectives and are not necessarily worried about the consequences on the rest of the world. Several large economies today have the lowest possible interest rates and are using quantitative easing to competitively depreciate their currency, creating distortions in other parts of the world. Leverage has increased significantly in the emerging market economies which can pose a threat to financial stability. There is no system in place today to check the excesses of monetary easing by some and its impact on others. Further, trade restrictions have grown in recent times which can have long-term consequences for the global economy.

Another area where the global leaders will have to coordinate and cooperate is climate change. Leaders will meet in Paris later this month to adopt a framework to restrict global warming. G20 has committed itself to a successful outcome of the Paris conference. Again, this will not be easy and would require a fair amount of flexibility on the part of both the developed and developing countries. Developed countries will also have to commit to transfer of technology and resources to the developing countries in order to attain the climate change objectives.

From geopolitics to economic growth and financial stability, the challenges and complexities for the world have increased a great deal, and it requires greater coordination among nation states at various levels. One of the ways to attain this is by strengthening and expanding the role of global institutions such as the UN and the International Monetary Fund so that they are in a position to devise rules which are fair to all and monitor implementation.

The war against terror or maintaining global economic and financial stability are not the responsibilities of one country or a small group of countries alone. In an interconnected and interdependent world, such challenges can only be met with greater international coordination through capable institutions.

Do countries need better coordination in dealing with emerging global challenges? Tell us at views@livemint.com

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